Coronavirus Lockdown: Jobless Rate Rises, Highest Debt Risk in Asia, and More!

More news about how the COVID-19 pandemic in the Philippines is being handled by the public and the government. 

Joblessness in the Philippines has increased to pandemic-era highs. 

https://business.inquirer.net/546317/philippines-jobless-rate-rises-to-pandemic-era-high

Unemployment in the Philippines climbed sharply in July, with 2.59 million people out of work compared with 1.95 million the month before, according to government data released on Wednesday.

The jobless rate rose to 5.3 percent from 3.7 percent in June, the Philippine Statistics Authority said.

The latest unemployment rate was the highest since June 2022’s 6.03 percent, when the economy was still lingering from the pandemic’s onslaught.

Measures of job quality also deteriorated. Some 6.8 million employed Filipinos said they were looking for additional work or longer hours to boost their income, up from 5.76 million in June. That pushed the underemployment rate to 14.8 percent, from 11.4 percent previously. 

It's not clear what is behind the lack of work but the Philippines has been in recovery mode since Duterte destroyed the economy by implementing devastating lockdowns across the nation.  

During the pandemic the Film Development Council of the Philippines was granted emergency financial and healthcare assistance in the total of 877,000 pesos. The COA said it needed to be returned but the SC has ruled otherwise. 

https://www.manilatimes.net/2025/09/12/entertainment-lifestyle/life-times/dio-fdcp-win-sc-case-over-pandemic-era-assistance/2183127

Former Film Development Council of the Philippines (FDCP) Chairman and CEO Liza Diño has won a legal victory at the Supreme Court, which has cleared her, former Executive Director Ria Anne Rubia, and all recipient FDCP employees from returning nearly P877,000 in Covid-19 financial and healthcare assistance.

The assistance package, which covered emergency healthcare support and food and grocery aid, was granted to the entire FDCP team in June 2020 at the height of the pandemic.

Unlike PhilHealth, which only covers a portion of hospitalization costs and excludes preventive care, FDCP’s emergency healthcare assistance allowed employees to seek medical attention and checkups early without fear of incurring costs.

“We knew that during the pandemic, fear kept people from getting checked even when they felt unwell because preventive care isn’t covered by PhilHealth,” Diño said. “The healthcare fund we provided meant our people didn’t have to hesitate or worry about where to get money if they needed to see a doctor or be hospitalized for Covid. That peace of mind was crucial.”

Diño, who ended her FDCP term in 2022, now heads the Quezon City Film Commission, where she continues to champion Filipino creativity on the global stage.

In 2021, the Commission on Audit (COA) disallowed the assistance and ordered its return, maintaining that PhilHealth coverage was sufficient. Diño and Rubia challenged the ruling before the Supreme Court.

In a resolution dated January 21, 2025, the high court partially overturned the COA decision, recognizing the humanitarian intent and good faith behind the aid program.

The case resonated within the entertainment and film community, many of whom recall FDCP’s pandemic-era initiatives that supported creative workers during production shutdowns and health risks.

“This case was never just about numbers on a balance sheet — it was about humanity in a time of crisis,” said lawyer Regie Tongol, counsel for Diño. “The Supreme Court’s ruling affirms that leaders who act in good faith to protect the welfare of their people should not be punished, but rather recognized for their compassion and foresight.”

Besides Tongol, John Matthew Cruel of Regie Tongol Law and Communications Legal Consultancy represented the petitioners. Diño continues to be a columnist for the Arts Awake section of The Sunday Times Magazine.

The SC says it was an issue of good faith and humanity and they also only partial overturned the COA's ruling. It is not clear what that means or if any money will have to be returned. 

ThePhilippines has been flagged with the highest debt risk in all of Asia. 

https://mb.com.ph/2025/09/11/philippines-flagged-with-highest-debt-risk-in-asia

Constrained fiscal and monetary policy space, along with increasing reliance on foreign debt, has placed the Philippines at the highest sovereign risk, or the greatest risk of failing to meet its debt obligations, among its Asian peers.

According to a Sept. 10 report by the think tank Oxford Economics, the Philippines recorded the highest sovereign risk score among 12 Asian economies, at 4.5 out of 10. The biggest contributor to this risk is limited internal policy space, referring to the country’s relatively narrow fiscal and monetary flexibility compared with its peers.

The second-largest factors are external imbalances—measured by current account and trade deficits—along with the size of the economy, and institutional risks. Other contributors include political risks, the business environment, vulnerabilities in the banking sector, and corporate debt.

India ranked second in sovereign risk, followed by China, Vietnam, Malaysia, Thailand, and Indonesia. Meanwhile, Japan, Singapore, South Korea, Hong Kong, and Taiwan were assessed to have the lowest risk levels.

Sovereign risk refers to the possibility that a government may default on its debt by failing to meet interest or principal payments.

“On the fiscal front, the stubborn bias towards fiscal conservatism is likely to persist, following the broad unwinding of pandemic-era discretionary support,” Oxford Economics lead economist Alexandra Hermann said.

However, given that “around half of the region’s economies are likely to fall short of their official growth estimates this year, and the remainder only just meeting stated targets, the political economy of growth underperformance could tilt authorities towards further incremental easing going into 2026.”

For the Philippines, the government is targeting a growth rate of 5.5 to 6.5 percent for 2025—a downscaled version of the more ambitious goal of six to eight percent previously.

While governments in Asia, including the Philippines, could implement measures to soften the impact of weaker exports, the think tank noted that economic growth would still be slower than normal. Philippine gross domestic product (GDP) growth averaged 5.4 percent in the first half of the year.

“On the monetary side, most central banks have room to cut further as real rates are still elevated compared to pre-pandemic norms, despite pre-emptive cuts this year particularly in emerging Asia,” Hermann said.

To recall, the Bangko Sentral ng Pilipinas (BSP) aggressively hiked lending rates to as high as 6.5 percent in 2024 to tame raging increases in consumer prices brought about by the Covid-19 pandemic.

Hermann expects the Philippine central bank alongside other Southeast Asian central banks to further reduce key borrowing costs by as much as three quarters of a point by early next year, similar to what they did previously during economic slowdowns.

“We anticipate an additional 25-75 bps [basis points] of rate reductions across India, Indonesia, the Philippines, and Thailand, completing an easing cycle by early 2026 that is broadly consistent in scale with prior non-recessionary slowdowns,” Hermann said.

Should the BSP reduce the key policy rate by up to 75 bps though the first half of 2026, the current five percent could be brought down to 4.25 percent. For this year alone, the BSP has so far lowered rates by a cumulative 75 bps, citing still subdued inflation and risks to slower growth.

In another Sept. 10 report of the think tank, the BSP and other central banks are seen to be “hawkish despite low inflation.” BSP Governor Eli M. Remolona Jr. earlier signaled a still accommodative stance but now less dovish.

While inflation remains within the government’s target band of two to four percent, Oxford Economics head of global emerging market (EM) research Gabriel Sterne expects this to elevate in the coming months.

Inflation quickened to 1.5 percent in August from 0.9 percent in July, which was the slowest in nearly six years. Inflation was faster in August despite the continued drop in rice prices, as supply chain disruptions from weather disturbances stoked food costs.

On the trade front, meanwhile, the Philippine economy is seen to have a relatively low exposure risk—around nine percent—linked to trade giants the United States (US) and China next year.

In comparison, Indonesia, Japan, and India have even lower exposure (all less than eight percent), while Singapore (around 58 percent) and Vietnam (around 45 percent) are considered highly exposed economies.

Hermann argued that the cushion of other Asian countries against the hit of lingering trade threats would be their high performance in services sectors that were slapped with relatively low tariffs.

For the Philippines, output gains would come from its business process outsourcing (BPO) industry, “which now extends into higher-value IT [information technology] and knowledge services.” Hermann noted that this sector has consistently supported household spending and brought in steady inflows from foreign exchange (forex).

The Philippines' high sovereign risk is driven by limited fiscal and monetary policy space, a consequence of increased debt from pandemic-era spending and subsequent efforts to tame inflation. This constrained flexibility, along with a reliance on foreign debt and external imbalances, places the country at a higher risk of failing to meet its debt obligations compared to its Asian peers. However, the resilient business process outsourcing (BPO) sector and potential monetary easing offer some buffers against a full-scale crisis.

Here is another story of Filipino resilience during the pandemic. This time they had help from Coca-Cola Philippines.

https://mb.com.ph/2025/09/16/coca-cola-philippines-istar-program-powers-family-owned-carinderias-rise-in-cebu

Coca-Cola Philippines continues to support Filipino micro-entrepreneurs through its entrepreneurship training programs, helping small businesses gain the right tools, knowledge, and confidence to grow and sustain their livelihoods.

Among the inspiring stories is that of Juniel and Salome Lucero, a couple from Pinamungahan town, Cebu province who turned a small food venture into a sustainable family enterprise.

Their business journey was guided by passion, persistence, and the right training provided by the iSTAR (Innovative Sari-Sari Store Training and Access to Resource) program, a joint initiative of Coca-Cola Philippines and the Technical Skills Education Development Authority, where they gained essential skills in financial literacy, inventory management, and basic operations.

Juniel, a former overseas Filipino worker (OFW), made a bold leap into the food business in hopes of turning his vision for success and Salome’s love for cooking into a reliable source of income for their family.

Together, the Luceros opened Nicolai’s Cuisine in 2018.

When the pandemic hit, Juniel returned to the Philippines, and the couple found themselves seeking new ways to support their family.

They changed their business approach and started selling packed lunches online, where they built a network of loyal customers.

Today, Nicolai’s Cuisine has expanded to three staff members, offers catering services, sells lechon (roasted) belly packages, and even runs a small trading sideline for plastic and paper packaging.

Their clients now come from different parts of Cebu, far beyond their barangay.

Their journey to success is not without its challenges. It was riddled with difficulties, especially during the first year of running Nicolai’s Cuisine.

Sales were unpredictable, their location had little foot traffic, and they lacked a system for managing operations.

(Business was struggling and sluggish, you just can’t tell what happens next. There were a lot of losses. And our location wasn’t ideal. With so many problems, we could only offer a few dishes)

Their turning point came in 2019 when Juniel completed the STAR Program (Sari-Sari Store Training and Access to Resources).

As the foundation of what would later become the digital iSTAR program, STAR helped them gain essential skills in financial literacy, inventory management, and basic operations.

In July 2024, they took their learning further by joining the iSTAR training program via the Lamac Multi-Purpose Cooperative.

They learned product costing, digital payments, online marketing, and customer engagement, skills they immediately applied by setting up online group chats with nearby schools and cooperatives for streamlined orders and mobile payments.

(Online sales are really booming. We live on a farm, so we used that (online channels) to reach more customers. When we started selling online, we thought ‘Why just now?’ But it’s not too late)

With their improved business strategy, the Luceros grew their monthly income from ₱30,000 to ₱50,000 that enabled them to provide better opportunities for their children.

Their business is registered with the Philippine Government Electronic Procurement System (PhilGEPS), giving them access to orders from local government units.

Their efforts also earned them recognition, receiving the Top One Most Impactful and Inspiring Award under the iSTAR, the HERStories program, an initiative that highlights inspiring entrepreneurs who applied their training to grow their businesses.

Now that they have a thriving business will Juniel return to being an OFW?